Media Launch on HSD & MS Prices

The Government of Native indian vide its aware No.P-20029/18/2001-PP old 16th Jan , 2003, advised "The Irrecoverable Taxes Agreement Scheme", 2002 to create up the oil companies for irrecoverable situation taxation to aid in smooth transformation from the used expenses system to the market recognized expenses system.

The system provided for settlement to Oil marketing and Enhancing companies in respect of irrecoverable situation taxation billed by the States/ local professionals  such as Accessibility Tax on Raw, Fee on income tax, CST/Purchase tax on inter company income of oil items and any other irrecoverable taxation. The settlement was set off with the quantity being collected by OMCs through the person cost variety under the go 'State Surcharge' for the period 2002-03. The 'state surcharge' aspect in the cost create up confident that the event of any irrecoverable tax of the particular situation was restored from the particular situation. The quantity of 'State Surcharge' has remained the same since then.

Over the last several decades, oil companies have been having difficulties improving level of under-recoveries due to irrecoverable taxation because of following aspects :

    a) New irrecoverable costs by Condition Governments
    b) Changes in Condition tax elements etc
    c) Excessive enhance in the expenses of oil and oil items in the globally trading markets and producing enhance on the taxes
    d) Development of Shop Advertising Prices of the oil Products and producing enhance of the taxes



As a impact of the above described aspects, the irrecoverable taxation have gone through decrease in some declares and enhance in others. Thus, there was a need to assessment the said system to create the encourage sensible on a state-to-state platform to indicate decrease in expenses in declares where the irrecoverable taxation have gone through reduce and impact enhance in expenses in declares where the said taxation have been enhanced as well as to reduce the stress of the OMCs due to irrecoverable taxation. Accordingly it has been determined to implement the enhanced structure of 'state particular cost (SSC)' to secure the irrecoverable taxation w.e.f evening time of 24/25 Sept, 2012.

As a impact of the said adjustment, HSD expenses shall take a place reduced in 11 declares. SKO(PDS) expenses shall take a place reduced in 9 declares, LPG(Dom) expenses shall take a place reduced in 12 declares and MS Prices shall take a place reduced in 11 States. In the same way, HSD Prices shall take a place enhanced in 7 declares, SKO(PDS) expenses shall take a place enhanced in 8 States, LPG(Dom) expenses shall take a place enhanced in 6 States and MS Prices shall take a place enhanced in 7 States.

The Effect of the alteration (excluding situation levies) in some of the declares is given in the table below :

Price Decrease :

State	HSD	SKO(PDS)	LPG (Dom)	MS
	Rs./litre	Rs./litre	Rs./Cyl	Rs/ litre
Karnataka	0.62	-	-	1.06
Goa	0.40	-	-	0.82
Gujarat	0.40	0.16	10.18	0.81
Jharkhand	-	0.14	-	0.55
Tamil Nadu	-	-	7.01	0.76
West Bengal	-	0.06	3.86	-
Odisha	0.32	0.07	4.15	0.52

Price Increase :

State	HSD	SKO(PDS)	LPG (Dom)	MS
	Rs./litre	Rs./litre	Rs./Cyl	Rs/ litre
Assam	1.95	0.80	19.43	2.13
Bihar	1.45	0.75	9.16	0.80
West Bengal	0.78	-	-	2.02
Maharashtra	0.72	0.32	8.72	0.72

The said scheme shall be reviewed on quarterly basis by the industry and required changes will be made in the State Specific Cost.

Media Launch on State Particular Cost (SSC)

Further to the press release issued on 24.7.12 informing about the revision, w.e.f. 24-25 Jul 2012, in the rates of 'State Specific Cost (SSC)' to cover the irrecoverable levies imposed by States on petroleum products, the full list of state-wise impact of revision in SSC excluding State levies is given in the tables below :

Price Decrease

Impact on State Specific Cost (SSC)
State/UT	MS	HSD	SKO(PDS)	LPG (Dom)
	Rs./litre	Rs./litre	Rs./litre	Rs./cyl
Karnataka	(1.06)	(0.62)		(6.55)
Goa	(0.82)	(0.40)	(0.08)	(5.17)
Gujarat	(0.81)	(0.40)	(0.16)	(10.18)
Tamil Nadu	(0.76)	(0.10)		(7.01)
Jharkhand	(0.55)	(0.24)	(0.14)	(3.66)
Odisha	(0.52)	(0.32)	(0.07)	(4.15)
Andhra Pradesh	(0.30)	(0.14)	(0.03)	(1.78)
Madhya Pradesh	(0.16)	(0.06)	(0.01)	(0.85)
West Bengal			(0.06)	(3.86)
Tripura	0.10)	(0.06)	(0.01)	(0.81)
Punjab	(0.03)	(0.02)	(0.00)	(0.26)
NCT of Delhi	(0.00)	(0.00)	-	(0.03)

Price Increase

Impact on State surcharge
State/UT	MS	HSD	SKO(PDS)	LPG (Dom)
	Rs./litre	Rs./litre	Rs./litre	Rs./cyl
Assam	2.13	1.95	0.80	19.43
West Bengal	2.02	0.78
Tamil Nadu			0.85
Bihar	0.80	1.45	0.75	9.16
Karnataka			0.64
Maharashtra	0.72	0.72	0.33	8.72
Uttar Pradesh	0.56	0.55	0.37	6.01
Haryana	0.05	0.04	0.06	0.78
Rajasthan	0.00	0.02	-	-
Kerala	-	-	0.69	1.14

Consequent to the said revision, the RSPs of main products, namely MS, HSD, SKO & LPG, before & after effecting the revision for the four metro cities are given below :

Product		N.DELHI	CALCUTTA	MUMBAI	CHENNAI
MS (Rs/litre)	REVISED RSP	68.48	76.13	75.14	72.19
	CURRENT RSP	68.48	73.61	74.23	73.16
	DIFFERENCE	0.00	2.52	0.91	(0.97)
HSD (Rs/litre)	REVISED RSP	41.29	44.66	46.17	43.83
	CURRENT RSP	41.29	43.74	45.28	43.95
	DIFFERENCE	0.00	0.92	0.89	(0.12)
SKO PDS (Rs/litre)	REVISED RSP	14.83	14.78	14.73	12.34
	PREVIOUS RSP	14.83	14.84	14.38	11.46
	DIFFERENCE	0.00	(0.06)	0.35	0.88
LPG Dom (Rs/cylinder)	REVISED RSP	399.00	401.00	423.00	386.50
	PREVIOUS RSP	399.00	405.00	414.00	393.50
	DIFFERENCE	0.00	(4.00)	9.00	(7.00)

Henceforth, any future change in the amount of SSC resulting from the incidence of State/ Municipal levy/ tax etc shall be given effect immediately within the respective State/ Municipal Area. Also, the SSC collections & incidence of irrecoverable taxes shall be reviewed on quarterly basis by the industry and required changes will accordingly be made in the State Specific Cost.
 

Media Launch on MS Prices

MS costs have been decontrolled by the Government of Indian w.e.f 25.06.10 and since then the Oil Promotion Organizations (OMCs) are totally able to fix the cost range of fuel. It has been made the decision by Native indian Oil Organization to improve MS costs by Rs. 0.70/litre (excluding condition levies) w.e.f late night of 23-24 September, 2012.

The said modification has been required due to improving worldwide oil costs and activity in INR-USD return amount. The normal cost of Native indian bag of raw for the appropriate costs interval regarded is $101.28/bbl while International MS cost is $111.59/bbl.  The Rupee-USD return amount is around Rs. 55.36/USD.  At these stages, IOC is running into failures of about Rs. 1.41/litre on MS revenue in the household industry.  However, as the cost activity is quite unpredictable, it has been made the decision that an improve of Rs. 0.70/litre (excluding condition levies) may be impacted at this point and the scenario seen for a while based on which a further perspective will be taken at an appropriate time.

During present financial, the Organization has already gathered failures of  Rs. 1053 crore (Industry: Rs. 2323 crore) on MS revenue during the first two several weeks due to great worldwide oil costs, destruction in USD-INR return amount & lack of ability of OMCs to change MS costs to preferred stage. Moreover, HSD, SKO(PDS) and LPG (Dom) costs stay the same since May,2011 leading to present stage of under restoration of  Rs. 10.01/litre on HSD, Rs. 27.20/litre on SKO(PDS) and  Rs. 319/cylinder on LPG(Dom). At these stages, estimated under restoration of IOC during 2012-13 for these three items is  Rs. 86000 crores  (Industry -  Rs. 160000 crores). In these conditions, the Organization is incapable to keep pressure of any further failures.

As a effect of the said modification, improve in cost range shall differ from Rs. 0.70/litre to  Rs. 0.91/litre (including State levies) based on the State taxation. In the condition of Delhi, the cost improve will be Rs. 0.70/litre (impact of State tax shall be nil on the improve as per Delhi Government. VAT exception to this rule purchase old Sixteenth May 2012). The cost modification in other Declares will differ based on the specific prices of State VAT / Sales Tax.

Existing and Revised selling prices for metros are given below :-
 

		New Delhi	Mumbai	Chennai	Kolkata	Hyderabad	Bengaluru
Proposed RSP	Rs./litre	68.48	74.23	73.16	73.61	75.80	77.30
Current RSP	Rs./litre	67.78	73.35	72.27	72.74	74.89	76.39
Increase	Rs./litre	0.70	0.88	0.89	0.87	0.91	0.91

IndianOil's Worldwide Forex Economical loan Collection breaches USD 7 Million Mark

Indian Oil Organization, the biggest corporation of Indian, has built up the foreign currency loan portfolio of USD 7 billion. The portfolio of USD 7 billion includes resources given by banking institutions located in various nations across world such as USA, UK, Norwegian, Holland, Malaysia, Portugal, Mauritius, South African-american, Middle Eastern, Asia, Taiwan, Singapore, Modern australia etc.

This portfolio is even more significant under the current situation when concerns are engulfing the international financial state particularly Dollar area, which is moving through unmatched economic disturbance. Though, foreign currency loans are available at considerably less expensive rates, the availment of any foreign currency loan is beat by finalization of complicated loan contracts and extensive due persistence by foreign banking institutions. It may be mentioned that due to interest rate differential in addition to lack of foreign currency resources, other Native indian corporates have been fighting hard for more of these resources. However, IndianOil, like ever before, has been able to entice ongoing flow of foreign resources due to its strong ranking in the international market.

In revenge of concerns in international marketplaces and limited household financial policy, IOC has been able to produce required resources for its funds and tasks.

Media Launch on MS Prices

It has been made the decision to modify MS costs downwards by Rs. 2.46/litre (excluding condition levies) w.e.f night time of 28-29 May, 2012.

The down modification shall differ from Rs. 2.46/litre to Rs. 3.22/litre (including State levies) based on the State taxation. In the condition of Delhi, the cost reduce will be Rs. 2.46/litre as the effect of State tax shall be nil on decrease until the prices as on Twenty third May'12 as per VAT exception to this rule order old Sixteenth May 2012 of Delhi Government. The loss of other Declares will differ based on the specific prices of State VAT / Revenue Tax.

		New Delhi	Mumbai	Chennai	Kolkata	Hyderabad	Bengaluru
Proposed RSP	Rs./litre	67.78	73.35	72.27	72.74	74.89	76.39
Current RSP	Rs./litre	70.24	76.45	75.40	75.81	78.11	79.61
Reduction	Rs./litre	2.46	3.10	3.13	3.07	3.22	3.22

During present financial, the Organization has already gathered failures of Rs 1053 crore (Industry: Rs 2323 crore) on MS sales during the first two several weeks due to lack of ability of OMCs to modify MS costs in line with advanced stage of worldwide oil costs & evaporated  USD-INR return amount existing during that period.


In inclusion, OMCs are struggling advanced stage of under-recoveries on the three delicate oil items, namely HSD, SKO (PDS) and LPG (Dom).  Last modification in amount of delicate items was performed in June'11.  As in contrast to last cost modify, present under-recovery on HSD has gone up from Rs.6.13 per liter to Rs.10.20 per liter, for SKO (PDS) from Rs.24.16 per liter to Rs.30.53 per liter and for LPG (Dom) from Rs.331.13 per cyndrical tube to Rs.396.00 per cyndrical tube as on Sixteenth June'12.  At these prices, it is approximated that under-recovery available of delicate items during 2012-13 shall be around Rs.83000 crore (Industry: Rs.151000 crore).

OMCs keep carefully observe the worldwide oil costs and the increasing situation in USD-INR forex prices to determine their prospective effect on costs later on. It may be mentioned that existing international financial circumstances have had an negative effect on world MS need leading to MS edges over raw oil costs dropping to not sustainable stages. Therefore, cost differential of raw and MS shall also be under a near observe later on.